Samsung SDI has decided to form a joint venture with local battery cathode supplier EcoProBM in a move to secure a more stable supply of batter-manufacturing material for electric vehicles, according to industry sources on Feb. 6.
A formal announcement is expected next week. Each company is likely take an equal stake, the sources said.
The decision comes after EcoProBM recently signed a long-term contract to supply cathode to SK Innovation, one of Samsung SDI’s rival firms in Korea. As a part of the deal with Samsung SDI, EcoProBM plans to produce high-nickel NCA cathode at its new plant in CAM6.
“A JV is a big step, and it indicates that both Samsung SDI and EcoProBM are looking for long-term ties,” said one market watcher.
The line in CAM6 – also known as the Samsung SDI cathode line – is estimated to have an annual capacity of up to 70,000 tons. This means the line will ship up to around KRW 1 trillion worth of cathode, according to industry experts. That is about three-fold of the annual 26,000 tons produced from the CAM5 plant in 2019. EcoProBM had spent KRW 180 billion on this facility.
Samsung SDI had originally planned on receiving cathode through a supply contract, but the firm changed its mind to opt for a JV after seeing that it would need more cathode for its battery plant in Göd of Hungary.
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